SBA 7(a) Self Storage Feasibility Study in Michigan

Michigan stands eighth nationally for 7(a) storage lending on loans counted, and its record is unusually large: 58 loans and $87.7 million between FY2017 and FY2026, with a median of $982,500 that matches the national 7(a) benchmark almost exactly at 1.01x. The central half of loans spans $358,125 to $2.2 million. What the cell adds beyond those totals is its lender mix, since four institutions appear and three of them hold double-digit books. Within Michigan the class is only twentieth of 39, so storage is a niche beside the state's larger lending lines. Franchising is 1.7% of loans.

Who holds the paper

Live Oak Banking Company leads with 15 loans and $42.7 million, ChoiceOne Bank follows at 13 and $18.0 million, Bank Five Nine at 12 and $16.6 million, and The Huntington National Bank at 5 and $1.1 million. The last has a far smaller average than the others. Such counts are SBA's records of notes held now or in the past, and they say nothing of how any bank lends. Macomb County has 8 loans, Saginaw 7, Genesee 6, Livingston and Oakland 3, and Clinton, Eaton, Iosco, Kent and Monroe 2 each. Iosco and Saginaw stand out as places far from the Detroit core.

A boom and a stall

Approvals grew from 5 in FY2017 to 8 in FY2021, then to 10 in FY2022 and 11 in FY2023, with FY2023 alone at $18.6 million. FY2024 fell to 4 loans, FY2025 to a single loan of $130,000, and FY2026 recovered to 6 loans and $18.4 million. A reader should notice that the dollars rebounded faster than the count, so the latest year is made of larger projects.

Cancellation floor and the unseen losses

Cancelled approvals were a minimum of 9.8% of those to FY2024; the broader count agrees. Charge-off experience is not printed, since too few loans are old enough. Recreational-vehicle and boat storage is coded with other storage, so some of these loans may finance vehicle yards.

A Michigan storage study

The study should map competing facilities by rent and square footage within a drive, count households and renters near the site, and use local figures for construction cost, utilities and snow loads on roofs. It should model month-by-month lease-up to stabilised occupancy and state the rent that meets debt service. Because the loan sizes run to millions, the appraisal is important; ask for value on completion and on stabilisation, and for a downside rent case. Michigan's mix of resort and industrial counties means the demand source, whether second homes, boats or households, must be named.